the Stifel anal-yst is a fool. the Math just doesn't add up
how can you lose 9% for the rest of the year when your best licensing renewals are in the 2H13?
either this dude has ulterior motives or he is an absolute fool. I usually think they are all Wall Street Criminals, but in this case, and, only in this case, I think this dude is a total fool.
A short while later, UBS’s Brent Thill responded by reiterating his Buy rating on VMW, and a $105 price target, writing that he spoke with EMC management following the call.
While the company would not comment on VMware’s expected cash flow, Thill thinks EMC is just being “conservative” and that there is no actual downside is necessarily implied:
We believe EMC is not providing ‘new’ cash flow guidance for VMW but rather to illustrate its FY13 FCF assumptions is simply using a conservative FCF estimate for VMW based on flat y/y OCF growth. Therefore no change to our FY13 OCF/FCF est of $2.2B/$1.8B. FQ1 OCF/FCF was +17%/+10%, to get to EMC’s figure would imply a OCF -9% for the remainder of FY13 which doesn’t make sense considering 2/3 of its ELA renewals which drive OCF are est’d in 2H. FQ1 saw strong ELA renewal trends suggesting healthy outlook for 2H ELA renewals.